ECON 160 Lecture Notes - Lecture 2: Corn Laws, Absolute Advantage, Opportunity Cost
5 Sep 2016
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Economist agree in theory, see graph different, changes outcome. Positive: a statement about an outcome based on economic theory. Ex. if a carbon tax is imposed " gasoline consumption will fall. Normative: about norms (should do) in society. Chapter 3: interdependence and the gains from trade. The industrial revolution gave great britain absolute advantage globally a manufacturing cotton cloth. In 1817 england most productive agriculture and most productive manufacturing because grain from other countries taxes lower than britain because opportunity cost of farming is lower in other countries than england because they have no manufacturing. Goods have to come through main ports to be seen. Opportunity cost of being in farming is opportunity lost because cotton wage is higher. Believed the wealth of the nation was from the wealth of the king. Wanted to put tariffs on grain imports so the grain they got from germany would increase the price of the grain from britain.
